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IPO scam: SEBI meet inconclusive

Last Updated: Tuesday, December 22, 2009 - 23:38

Mumbai: The SEBI Board, which met here on Tuesday to discuss the alleged failure of NSDL in preventing the IPO scam during 2003-05 did not take any decision, sources said.
"The Board on Tuesday heard the NSDL matter but no final decision was taken, that will take some time," the source close to the development told PTI here.

Sebi Chairman C B Bhave, who was heading NSDL during the period of the alleged scam, did not attend the session which was chaired by Mohandas Pai. The National Securities Depository Ltd keeps records of equity transactions and demat accounts.

Bhave later succeeded M Damodaran as SEBI chief in February 2008.

The IPO scam case refers to the SEBI`s investigations into 21 IPOs that hit the market between 2003 and 2005. SEBI`s probe revealed that shares reserved for retail investors were illegally acquired by various entities through tens of thousands of fake demat accounts and fictitious applications.

A two-member bench was constituted after Bhave took over as Sebi chairman. The bench comprising G Mohan Gopal (Director of National Judicial Academy) and former RBI Deputy Governor V Leeladhar had passed an order against NSDL, directing it to carry out an independent enquiry to establish individual accountability for the failures of NSDL in the IPO scam.

However, SEBI had cancelled the orders by the two-member bench after seeking external legal opinion from C Achuthan, former presiding officer of the Security Appellate Council (SAT) and a Director of NSE, a promoter of NSDL.


First Published: Tuesday, December 22, 2009 - 23:38

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